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With so many scandals swirling around the Obama administration, it is hard to identify which is the most politically damaging for the president. But there’s no doubt which one should trouble constitutionalists the most. The Internal Revenue Service’s targeting of conservative groups raises core questions about the nature of our government that the public has ignored for generations. It’s high time to revisit the issue of how the people can maintain control over those who are supposed to do their business.

Gary Locke

Political scientists and economists have identified the “principal-agent problem” that rational actors face when trying to outsource management of their affairs. How can a “principal” induce her “agent” to work for her interests rather than his own? The Constitution is an attempt to manage the principal-agent problem in a republic, though the Founders didn’t understand it in those terms. The founding document institutes a system of checks and balances to ensure that elected officials work on behalf of the people, rather than themselves.

Yet the Constitution barely touches upon the bureaucracy, the modern version of which the Founders couldn’t have imagined. It merely empowers Congress to create executive departments and charges the president to make sure the laws are faithfully executed. This gives little direction, as the Framers—like most republican thinkers of their day—were more interested in the relationship of the three main branches of government to each other and to the people. It would be up to later generations of Americans to fill in the gaps, and they struggled for a century to find a reasonable organizational scheme for the civil service.

More by Jay Cost

The original bureaucracy has often been called a “government by gentlemen,” which more or less persisted through the Jeffersonian era. Bureaucrats were thought to be public-spirited, independently established farmers or merchants who could put aside their own interests for a while to serve the public good. Thomas Jefferson, Albert Gallatin, and Alexander Hamilton all fit this mold—none of them ever made a dishonest dollar from public service.

By the 1820s, fraud was creeping into the executive departments, which in turn contributed to the Jacksonian revolution and a sea change in how the bureaucracy was staffed. Andrew Jackson believed that government by gentlemen had degenerated into rampant corruption, tilting public policy away from the interests of all the people (or at least his main constituency in the West) towards the elites. He instituted “rotation in office” as a tool to clean out the bureaucracy and make it more reflective of the general public, and thus (he hoped) more responsive to the public good.

But rotation in office soon became the corrupt “spoils system,” facilitating the graft and mismanagement that characterized the federal government during the Gilded Age of the late 19th century. Reformers of this period began calling for an educated, professional bureaucratic class free of political interference. After the assassination of President James A. Garfield in 1881 by a man rejected for a diplomatic post, the public outcry led Congress to respond with the Pendleton Civil Service Reform Act, the first major stab at improvement.

More reforms would follow over the years, giving rise to the (supposedly) apolitical bureaucracy that we have today. Indeed, the professionalization and autonomy of the bureaucracy was a prerequisite for the modern liberal state, which claims moral legitimacy through the disinterested application of “scientific” principles of management. It wouldn’t have been possible if the percentage of political appointees had not been scaled drastically downwards between the Civil War and the Great Depression.

That is how America ultimately addressed the principal-agent problem of the bureaucracy: We would hire only qualified people, free them almost entirely from politics, and insist they employ this new “science” of administration.

But is this solution still satisfactory? Today there is one member of Congress for approximately every 5,150 civilian members of the executive branch. How can the people’s representatives possibly keep track of all those bureaucrats? And if they cannot keep track, what is to stop the worst fears of Andrew Jackson from being realized? His “rotation in office” did not turn out to be a salutary alternative, but that does not negate his critique of the status quo. A bureaucracy that is too insulated from the people runs the risk of antirepublican corruption, regardless of whether it is staffed by “gentlemen” or those with master’s degrees in public administration.

The targeting of conservative organizations by the Internal Revenue Service suggests that this risk is not insignificant. Career bureaucrats there—presumed to be above politics—unduly went after Tea Party groups, effectively denying them their constitutional right to equal protection, for years. All the while, Congress did nothing. The agency’s inspector general failed to blow the whistle in a timely fashion. The media overlooked the many transgressions. And now, the bureaucrat in charge of the division, Lois Lerner, has lawyered up, taken the Fifth Amendment, and thus will slow the investigative process to a crawl.

This does not appear to be an isolated incident, either. Last month, National Review reported that a longtime colleague of Lerner has known for decades that she harbored suspicions of conservative groups. The Weekly Standard has reported that while at the Federal Election Commission, she harassed the Christian Coalition in a similar manner. Far from being reprimanded for this, she was promoted—during a Republican administration, no less! Recent reports, moreover, suggest that the Environmental Protection Agency has been making conservative groups pay Freedom of Information Act fees while waiving them for liberal organizations.

The Declaration of Independence vested all sovereign power in the people alone, while the Constitution established a government to manage that power in a republican fashion. While the people still swear fealty to the founding ideals, they have not put much thought recently into the problems the Founders tackled. As society has become more complex, the government has, too; Americans have not reexamined the structure of government, in an age in which it accounts for more than 20 percent of the national economy, to ensure it still reflects the republican spirit. In fact, there has not been a serious public discussion about the organization of the bureaucracy since the 1880s, even as it has doubled in size many times over. And so today, it is a vast enterprise of millions of workers, with precious little oversight from the people’s elected representatives.

It’s no wonder that some agency somewhere in the bureaucracy could have worked so perniciously for so long against the people’s interests. Perhaps the only surprise is that we ever noticed the malfeasance at the IRS at all. Were it not for the over-the-top questioning from the IRS—asking one group to pledge not to protest abortion clinics, another to reveal what books their members were reading, another to say what they’re praying about—all this might still be hidden in the shadows, unbeknownst to an overburdened Congress and an incurious media. And it remains to be seen what will be done about it, whether the bureaucracy, now under attack, has the resources and wherewithal to block oversight and prevent reform.

The IRS scandal should serve as a wake-up call. We can no longer take for granted the matters of republican governance over which the Framers obsessed. They rightly understood that a republic is a terribly difficult form of government to preserve. We wrongly presume that it is our birthright. As a result, we risk losing our inheritance.